Bitwise, a San Francisco-based crypto asset manager, has confirmed plans to launch a new exchange-traded fund (ETF) focused on XRP, the seventh-largest cryptocurrency by market cap. The firm recently filed an application with the state of Delaware, which has now been verified as legitimate. This move follows the U.S. Securities and Exchange Commission (SEC)’s approval of Bitcoin and Ethereum ETFs earlier this year, which have drawn significant investor interest.
ETFs, which trade on stock exchanges, provide investors with exposure to specific assets without requiring direct ownership. Crypto ETFs, in particular, have gained momentum in the U.S., with billions of dollars in inflows shortly after their approval. If successful, Bitwise’s XRP fund could mark another milestone for the crypto investment landscape, further expanding the variety of digital assets available to institutional and retail investors alike.
However, despite the growing popularity of crypto ETFs, Bitwise remains cautious. The company confirmed the authenticity of the filing to Decrypt but declined to offer further comment, stating that it does not comment on filings still in the early stages.
XRP’s Tumultuous History with the SEC
The launch of an XRP ETF isn’t without its complications. XRP, created by Ripple to facilitate faster cross-border payments, has long been at the center of a high-profile legal dispute with the SEC. The agency filed a $1.3 billion lawsuit against Ripple in 2020, accusing the company of selling unregistered securities in the form of XRP to raise capital.
The legal battle has seen significant developments over the years. In 2023, Ripple achieved a partial victory when a federal judge ruled that programmatic sales of XRP to retail investors did not qualify as securities. However, the court also found that Ripple’s $728 million in institutional sales did constitute unregistered securities, creating a nuanced outcome in the case.
Despite the ongoing uncertainty, the crypto industry widely interpreted the retail ruling as a positive sign for XRP and the broader crypto market. The decision sent ripples across the sector, offering some hope for clearer regulatory guidelines on digital assets.
Uncertain Approval from the SEC
Given the SEC’s longstanding issues with Ripple, it is unclear whether Bitwise’s XRP ETF application will be approved. While Bitcoin and Ethereum ETFs have received the green light, the agency’s stance on XRP remains complicated by the unresolved legal matter.
A successful approval of an XRP ETF would signal a significant shift in the regulatory landscape, providing legitimacy to a digital asset once mired in controversy. Yet, until the SEC takes a definitive position, the fate of this fund remains uncertain.
In the meantime, XRP’s price has shown resilience. The cryptocurrency is currently trading at $0.61, a 3% increase over the past week, reflecting renewed interest and optimism around the asset’s future.
As the situation develops, all eyes will be on the SEC and its decision regarding Bitwise’s ETF proposal.
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